ESOP advisor in Fenton, MO. Employee stock ownership plans (ESOPs) have become an increasingly well-liked retirement benefit for employees in a variety of sectors in Fenton, MO. They offer business owners an opportunity to pass the torch from their company while greatly reducing taxes on the sale, and offer employees a tax-advantaged retirement plan that builds their productivity and motivation. However, designing, implementing, and maintaining an ESOP isn't something most Fenton, MO business owners can do without professional help. Correct Capital's proficient and savvy ESOP advisors help businesses of all sizes, in Fenton, MO and around the nation, create tailored retirement plans that benefit themselves, their employees, and their revenue.
If you're looking for a trustworthy financial partner in Fenton, MO who shares your goals of creating your company and employees for long-term success, call Correct Capital at 877-930-4015, contact us online, or schedule a consultation with one of our financial advisors immediately.
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Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.
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About Employee Stock Ownership Plans (ESOPs)
An ESOP is a tax-advantaged retirement plan where employees receive stock of the company they work for, rather than savings or investments in other companies as in a typical retirement plan. ESOPs are 100% company funded, and often times shares offered to employees are not controlling shares, meaning control of the company stays with the C-suite. They offer superb incentives to employees while providing businesses with an enhanced value proposition in the hiring process, and allow business owners to set up a succession plan while preserving control. When they retire, most employees sell the stock at market value.
Perhaps even more importantly, by selling part of your ownership to the ESOP, owners can defer capital gains taxes, allowing you to disperse that tax hit instead of needing to pay taxes at once. In many cases, ESOPs are a succession plan that keeps the most amount of money possible in your pocket.
Benefits of an Employee Stock Ownership Plan
- Sell a portion of your business (minimum 30%) with deferment of capital gains taxes (provided you reinvest into qualified replacement securities)
- Further tax deductions through contributions made to employees
- If the business is eventually 100% owned as an S-Corp by the ESOP, it's not subject to federal income taxes
- Align the goals of employees and stockholders
- Present a higher value proposition when hiring
- Boost employee motivation and productivity
- Enhance employee retention and loyalty
- Enable succession planning and business continuity
- Maintain control while planning or easing into retirement
- Boost personal liquidity of owners, but still hold on to control of the company
- Carry on your business' legacy and culture
What About KSOPs?
A KSOP is a tax-advantaged plan that is a mix between an ESOP and a 401(k). Ownership shares are extended to employees as in an ESOP, employees can deposit their own money to buy additional stock through payroll deductions, or the company can match employee contributions with shares instead of cash.
Setting up a stock ownership plan doesn't have to exclude your employees from the risk tolerance that comes with diverse investments. In fact, incorporating an ESOP or KSOP to a more traditional retirement plan allows you to receive the benefits of both. The experienced Fenton, MO ESOP advisors and retirement consultants of Correct Capital can aid you find the right plans for your business.
What Our Fenton, MO ESOP Advisors Do for You
Whether you're motivated by a succession plan, employee incentives, or any other of ESOPs' benefits, you'll need an experienced Fenton, MO ESOP advisory firm by your side to get the most out of your plan. When you work with Correct Capital, we:
- Lower your tax liability as much as possible — When you transfer your ownership shares to an ESOP, you have the option to reinvest the proceeds in different securities to defer capital gains taxes on the sales, permitting you to keep more of the profit. To defer capital gains taxes, your ESOP advisor can help you execute a Section 1042 exchange by selling at least 30% of your company to the ESOP and reinvesting the proceeds in qualified replacement securities or QRP. Taxes would be owed until the taxpayer has a disposition of the QRP. An ESOP advisor can guarantee you obtain the most tax benefit from your ESOP.
- Customize your ESOP and retirement plans — Along with your team, we'll create and implement an ESOP that works best for you and your distinctive company. We like to push ourselves and our clients to get imaginative with retirement plan offerings to optimize the advantages they provide. We'll assess your needs, evaluate several ESOP options, and suggest a tailored ESOP that meets legal requirements and is aimed at maximizing benefits. If it makes sense, we may also recommend combining an ESOP with a 401(k) or different retirement plans to additionally boost benefits, yet retain efficiencies.
- Conduct a ESOP feasibility study — When we first meet with our clients, we work to understand their needs and collaborate with them to find the optimal qualified retirement plans for their company. For clients looking at an ESOP, part of that means performing a feasibility analysis to ascertain if it's a feasible option for your company. We'll analyze:
- Cash flow, debts, and overall financial health
- Ownership structure to understand how it'll be affected by introducing an ESOP
- Employee demographics to understand how they're best served
- Tax implications for both your company and shareholders
- Company culture and employee engagement to determine if an ESOP is likely to be well-received and supported
What if your business isn't a great fit for an ESOP? We'll partner with you to find a retirement or succession plan that works for you.
- Connect you with valuation firms and trustees — Implementing and maintaining an ESOP involves a lot of moving parts, including CPAs, attorneys, and a trustee to buy stock of the company on behalf of the ESOP. An experienced ESOP advisor with a strong network in Fenton, MO can help you arrange your ESOP team with reliable partners.
- Ensure compliance — IRS, Department of Labor, and ERISA all have strict guidelines for the management of employee stock ownership plans. For example, when individuals enrolled in an employee stock ownership plan at a closely held employer receive company stock in an ESOP distribution, they have the right to demand the employer to buy back them at market value.
- ESOP sustainability assessments — In an ESOP, shares are granted to employees over time based on length of service. Usually, that means ownership of the company is sold to the ESOP in phases. Depending on how you structure your company and the plan, your ESOP may start with 30%, but could ultimately achieve 100% ownership. As the plan evolves and matures, so will its implications for your company. ESOP advisors can plan for these changes and adapt to them in real time, enabling your plan to stay workable, in accordance with regulations, and profitable.
- Employee communication and education — Our ESOP advisors offer collective workshops and individual consultations with your employees so they can get the most from your retirement plan. With an ESOP advisor from Correct Capital, your employees won't just attain a portion of your company, but they'll feel like they're achieving ownership of their economic well-being and eventual retirement.
Why Choose Correct Capital as Your ESOP Advisor in Fenton, MO
Correct Capital is an independent advisory firm that specializes in helping business owners establish retirement plans and succession plans for their enterprises. There are several factors we point to that make us unique from other financial advisory firms in Fenton, MO, and all over the U.S.:
- We know retirement plans and ESOPs. Correct Capital's clients currently operate these plans in a wide range of sectors, including for construction companies and contractors. As we work with both businesses and individuals and families to support in setting up retirement plans, we're perfectly positioned to understand the needs of each and develop a plan that meets the requirements of both, as well as those of your stockholders.
- As independent fiduciary advisors, we are legally and morally bound to do what's in the utmost benefit of you, your employees, and your company. We aim to form long-term relationships with our clients based on trust and the common goal of expanding your and your employees' financial prosperity.
Other services we offer in Fenton, MO:
Call Correct Capital to Speak With an ESOP Advisor in Fenton, MO Today
If you're interested in learning more about ESOPs or desire to commence the process of setting one up for your Fenton, MO business, get in touch with a Correct Capital ESOP advisor at this moment. Let us do what we do best so you can concentrate on what you care about most: establishing yourself, your business, and your employees up for achievement. Reach out with one of our Fenton, MO ESOP advisors now at 877-930-4015 or contact us online.
